Plug in the 3.5mm cable into the controller (the USB cable doesn't need to be connected as it only powers the LED lights) and check the headset cable controls to make sure that the mic is switched on.
Work through the following steps to configure the headset:
1) Go to the PS4 Settings > Devices > Audio Devices.
2) Click Input Device and select Headset Connected to Controller.
3) Click Output Device and select Headset Connected to Controller.
4) Click Volume Control (Headphones), and set the level to maximum.
5) Click Output to Headphones, and select All Audio.
6) Click Adjust Microphone Level, then follow the wizard to calibrate your microphone.